Anthony Albanese has refused to say whether or not he will raise taxes after Treasury advised a hike to fix the federal Budget deficit.
Insiders host David Speers grilled the prime minister on the topic on Sunday following revelations Treasury had made the suggestion.
In an extraordinary blunder, bureaucrats mistakenly released parts of a secret briefing document given to the incoming Labor government in response to an ABC Freedom of Information request.
In the briefing notes, officials told Treasurer Jim Chalmers that ‘tax should be raised as part of broader tax reform’ to make the federal Budget ‘sustainable’ as Treasury forecasts years of Budget deficits.
The officials suggested the government ‘build on’ its superannuation tax and raise ‘indirect taxes’, such as those on alcohol and tobacco, with personal income taxes now making up more than half of Commonwealth revenue.
‘Is Treasury right? Do we need to increase the tax take?’ Speers asked Albanese.
‘Well, what we need to do is to make sure that our tax system is fair, and we will always do that,’ the prime minister replied.
Speers repeated his question, before Albanese avoided answering for a second time.
‘Well, what we need to do is get fiscal policy right,’ he said.
Speers asked what that meant for voters, and if it directly translated to increasing the total amount of taxation.
‘What it means is what we’ve done, which is we produced two budget surpluses and we’ve reduced the budget deficit going forward, compared with what it was anticipated to be before we were elected,’ Albanese said.
The prime minister reasoned Treasury advice was not government policy, and said he encouraged departments to put forward their advice.
He said his Labor government would keep a close eye on the budget and ‘be responsible’.
‘But surely you have an idea, as to when you look at the budget, whether you agree that tax needs to go up and spending needs to go down to fix it?’ Speers asked a third time
‘What I agree to is what we do in the Expenditure Review Committee, that’s already begun meeting… [and] examine each policy to make sure that there’s value for money,’ Albanese said.
He also said other policies like his superannuation tax changes would ‘come in time’.
The Treasury advice was accidentally provided to the ABC along with other documents in response to a Freedom of Information request.
While the document featured the typical redactions, a Treasury official forgot to black out sensitive headings and subheadings, disclosing secret and politically damaging information.
The advice forecast years of budget deficits.
Officials suggested the government ‘build on’ its superannuation tax and raise ‘indirect taxes’, such as those on alcohol and tobacco, with personal income taxes now making up more than half of Commonwealth revenue.
The document also shows officials bluntly told Labor that the party’s pledge to build 1.2million homes over five years in response to the housing crisis ‘will not be met’.
Labor is already seeking to increase taxes on super balances above $3million.
Chalmers at the time declined to rule out any new tax hikes ahead of the August economic roundtable.